In a surprise announcement today, Microsoft has announced major changes to its leadership group as a part of a company-wide reorganization. With these changes, the company is transitioning focus towards the cloud and AI.

In an email sent out to employees today, CEO Satya Nadella notes that as Microsoft endeavors to build technology that is more accessible and beneficial to the society, some restructuring of the company needs to take place.

Terry Myerson, Executive Vice President of the Windows and Devices Group, will be stepping down from his position, and will "pursue his next chapter outside of Microsoft". This is a very significant move, considering that Myerson has been working at the company for the past 21 years. The executive has also led the engineering and software teams behind Microsoft Exchange and Windows Phone. Nadella will be working with Myerson over the next few months in this transition process.

Microsoft will also be creating a new "Experiences and Devices" division led by Rajesh Jha, Executive Vice President of the Microsoft Office Product Group. The purpose of this team will be to "instill a unifying product ethos across our end-user experiences and devices" by bringing Windows, Office, and third-party applications and devices into a close-knit Microsoft 365 experience.

Other changes in leadership include:

Devices: Panos Panay will now serve as our Chief Product Officer and will lead our devices vision and further our product ethos across hardware and software boundaries for our first-party devices, while creating new categories and opportunities for the entire ecosystem. He will be the key leader ensuring end-to-end devices business execution excellence.

Windows: Joe Belfiore will continue leading our Windows experiences and will drive Windows innovation in partnership with the PC and device ecosystem. The future of Windows is bright as we continue to innovate across new scenarios and device form factors, and more deeply connect to our Microsoft 365 offerings. Joe will share more about the Windows roadmap at Build.

New Experiences and Technology: Kudo Tsunoda will continue to lead this team to define how we engage users with high-value experiences to help them achieve more.

Enterprise Mobility and Management: Brad Anderson will continue to lead our Windows Enterprise deployment and management efforts with even tighter alignment across Microsoft 365 and will partner closely with the EMS teams within Cloud + AI Platform.

Furthermore, Microsoft executive Scott Guthrie will be taking on the job of leading a new team working on cloud and AI, in addition to his existing responsibilities. Jason Zander is being promoted to Executive Vice President, Azure. His team will work on accelerating efforts in building a cohesive distributed computing infrastructure and application model. Harry Shum will continue to pour his efforts into the AI + Research group, and Microsoft says that it will continue to invest in this sector.

Satya Nadella further noted that:

To truly get the best impact from our efforts, we will have to push ourselves to transcend Conway’s law. Having a deep sense of customers’ unmet and unarticulated needs must drive our innovation. We can’t let any organizational boundaries get in the way of innovation for our customers. This is why a growth mindset culture matters. Each one of us needs to push on what technology can do for people and for our world. It will take courage to keep learning and growing together — encouraging one another’s individual strengths, building more diversity and inclusion across our teams, and collaborating as One Microsoft. It’s amazing what we have been able to accomplish together, and yet I still believe we are in the very early days of what is possible.

Microsoft states that it will be discussing these changes in detail at its Q&A session next week. It can be seen that these are major organizational changes which emphasize Microsoft's change in direction as it transitions focus to the cloud and AI, which it believes are the keys to its long-term success.